Are You Better Off Renting or Buying In This Market?

Wexford Rentals & Property Management has read that if you wanted something to take the heat out of the property market, then Conor Skehan may have found it.  The head of the Housing Agency has been extraordinarily blunt by saying that he has no intention of buying a house in Ireland again and is happy to rent for the rest of his life.

The Housing Agency advises the Government and local authorities on housing policy. For a man in his position to say this is newsworthy on its own. But is he right? Are all those first-time buyers who prudently sat out the boom and now want to get on the property ladder really as foolish as he seems to indicate? The answer probably depends on where you want to live. In certain parts of Dublin, it may well be cheaper to rent than buy, but in other parts of the city and around the country, it will make more sense to buy. A quick check on showed a 1,200 sq-ft three-bed in Ranelagh in south Dublin selling for €845,000. Meanwhile, a 1,130 sq-ft three-bed semi in Coolock on the northside of Dublin can be had for €265,000. While that is not an apples-to-apples comparison, it would be pretty hard to argue you are better off renting the Coolock property instead of buying it. But there perhaps is a case for renting in Ranelagh, instead of trying to scrape together the money to pay an enormous mortgage.

Mr Skehan is right to highlight that, for many people, long-term renting is becoming a way of life. The old adage about renting being money down the drain is perhaps not as true as it once was. However, the Irish property market is singularly unsuited to long-term renting at present. Leases are too short – it is difficult to get a lease of more than a year – so there is no security of tenure. There are practically no apartments set up for long-term family living either. There is a case to rent rather than buy, but it will not suit everyone.

Peter Flanagan